Thread: Law of Property Act 1925

Hi,
I've just been reading through it as a lot of debt collectors seem to be hiding behind it.
One thing that has immediately stood out is that it's not actually for civil debts or credit tokens, it's as it says for property or rent.
It specifically says "Land" and "Legal Estate" in the act and I can find no part of it that would allow it to actually govern a civil debt. It always mentions "interest in land", "lease" and "estate" etc.
If someone can prove me wrong then please do so, if not I'd like a discussion as ownership can be questioned.
Thanks.

Originally Posted by broken arrow

136 Legal assignments of things in action

(1)Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal thing in action, of which express notice in writing has been given to the debtor, trustee or other person from whom the assignor would have been entitled to claim such debt or thing in action, is effectual in law (subject to equities having priority over the right of the assignee) to pass and transfer from the date of such notice—

a)the legal right to such debt or thing in action;

So basicaly one part of the whole act is being pulled out and made to imply it relates to any debt? The act is quite clear that the debt relates to property, rents, mortgages and leases etc. It's law of property, property in the sense of land and houses. It's not for credit tokens.

Originally Posted by NitrousOxide

So basicaly one part of the whole act is being pulled out and made to imply it relates to any debt? The act is quite clear that the debt relates to property, rents, mortgages and leases etc. It's law of property, property in the sense of land and houses. It's not for credit tokens.

With respect it is - there is a body of case law which makes clear that s136 applies to debts

Have a look at this really helpful post from Docman

http://www.consumeractiongroup.co.uk...ml#post2025836

Originally Posted by I've got no money

With respect it is - there is a body of case law which makes clear that s136 applies to debts

Have a look at this really helpful post from Docman

http://www.consumeractiongroup.co.uk...ml#post2025836

Again these cases relate to debts of property not credit. They are also about the legality of the notice of assignment and most involve debts related to property.
As far as I can tell none of the case laws involve consumer credit. When the LPA 1925 refers to debt it means rent arrears, tenancy and mortgages etc.

Originally Posted by NitrousOxide

Again these cases relate to debts of property not credit. They are also about the legality of the notice of assignment and most involve debts related to property.
As far as I can tell none of the case laws involve consumer credit. When the LPA 1925 refers to debt it means rent arrears, tenancy and mortgages etc.

I hate to be difficult but have you actually read any of the cases referred to.

The leading cases on Assignments are both Court of Appeal decisions WF Harrison & Co Ltd v Burke which was where a hire purchase company assigned debts due under a Hire Purchase agreement and the case of Van Lynn Developments Ltd v Pelias Construction Co Ltd which involved the assignment of a bank overdraft.

It is not a question of assigning credit - it is the assignment of debt...

You could also look at

Essar Steel Ltd v Argo Fund Ltd 2006 EWCA Civ 241
Contract – Construction – Contractual term – Syndicated loan agreement restricting valid assignments to 'bank or other financial institution' – Meaning of 'other financial institution' – Whether claimant a 'financial institution' – Whether assignments of defendant's debt to claimant valid and effective
OR
Firstdale Ltd v Quinton
[2004] EWHC 1926 (Comm), 2003 Folio 1079, (Transcript)
OR
Re a Company (No 003624 of 2002) [2002] All ER (D) 274 (Dec)

Originally Posted by Kraken1

and rent arrears is a....?

Not a credit token.

Firstdale Ltd v Quinton deals with service and was about a company that went into liquidation. This was about estate, and estate can mean any asset worth a value hence why recievers are used. Again the LPA 1925 names estate in the act.
A company that is wound up would be sellable under the LPA as the property it can sell falls under estate.

I'll read the rest a bit later and comment, but as yet no one has shown me a case involving credit tokens.

Originally Posted by NitrousOxide

Not a credit token.

Firstdale Ltd v Quinton deals with service and was about a company that went into liquidation. This was about estate, and estate can mean any asset worth a value hence why recievers are used. Again the LPA 1925 names estate in the act.
A company that is wound up would be sellable under the LPA as the property it can sell falls under estate.

Surely debts owed to the company are treated as property aren't they...they are certainly assets

I'll read the rest a bit later and comment, but as yet no one has shown me a case involving credit tokens.

Originally you claimed that we hadn't referred to any cases involving credit- HP is a debt as is a bank overdraft.

You actually didn't ask for a case involving credit tokens - I personally can't see the difference, in principle, between an overdraft and a credit token.

Can you refer me to a case that says it is not possible to assign a credit card debt - you may find that there isn't a case on the point mainly because the point is obvious that you can assign that no one has wasted their time litigating it...

Originally Posted by I've got no money

Originally you claimed that we hadn't referred to any cases involving credit- HP is a debt as is a bank overdraft.

You actually didn't ask for a case involving credit tokens - I personally can't see the difference, in principle, between an overdraft and a credit token.

Can you refer me to a case that says it is not possible to assign a credit card debt - you may find that there isn't a case on the point mainly because the point is obvious that you can assign that no one has wasted their time litigating it...

Point I'm making is it's the wrong act to use.
Anyone who has used this act before will know that it deals with property and as I've said before the term "debt" is used for rent arrears, tenancy and mortgages. The act is very specific about this.
Otherwise you could pluck parts from any act and suit them at will.

Again look deeper into those cases quoted, and in particular how they are secured.

The ability to sell the debts on actually lies in contract, as it's a part of the terms and conditions. I checked this myself and most have a clause about selling on and DCA's etc. This is what enables the assignment not the LPA 1925.
If your contract doesn't say it, it can't be sold. You could also challenge the "rights but not duties" crap that DCA's come out with.

Originally Posted by Kraken1

can't agree. a debt is a chose in action and is property.

I was just about to say that...

I think that you misunderstand some of the language - an estate includes debts

Originally Posted by robcag

Hi All

Going slightly off topic, but relevant I think, isn't it the case that a credit card debt (or possibly any debt) can only be assigned if there is a specific clause in the agreement which permits this? So in the absence of, or if only an unenforceable agreement is available, then no obviously no such clause would be available.

Or have I got this completely wrong? ISTR a CAG thread which discussed this quite a while ago, but can't remember right now which one it was or who started it.

Here's a couple of interesting (but possibly conflicting) viewpoints;

Assignment of contract: Legal advice - London lawyers

Assigning A Debt Or Benefit Of Contract? - Information Technology Law Articles and News - Lawdit Reading Room

Cheers
Rob

My view is that the Lawdit opinion is accurate

This issue keeps cropping up in various forms - in many ways it's academic because most agreements contain an express provision. In terms of uneforceable agreements - unenforceability in terms of CCA unenforceability does no IMHO relate to provisions relating to assignments.

I personally think that the only way that it'll be resolved is if a Cagger tries running the argument - it certainly won't be me.

Have a look at a couple of cases Helstan Securities and perhaps the Linden Gardens Trust case both of which if my memory serves me right deal with the point.